Bitcoin has crossed 116,000 US dollars for the first time. So why did this massive rise happen?
The issue has several interconnected reasons.
There have been huge inflows from large financial institutions that started investing their money in Bitcoin after investment funds like Crypto Blue Chip ETF emerged, which combines Bitcoin, Ethereum, and Solana. This created a new sense of confidence among both large and small investors.
Also, US policies have become more flexible towards crypto, especially after the current administration announced its intention to support innovation and clear regulations instead of tightening. This reassured the market and increased demand.
There is also an emotional aspect; many people see Bitcoin as digital gold, meaning a way to preserve money's value amid inflation and economic turmoil.
But at the same time, we must be mindful that Bitcoin is inherently very volatile. This means it could correct again and drop a bit due to profit-taking or any negative news regarding regulations or the global economy.
If this trend continues, we might see Bitcoin breaking higher levels, but one must be prepared for volatility and not put all their money into a single asset. In general, what has happened proves that Bitcoin has moved beyond being just a digital currency and has become an actual part of the global financial system.
